Overview of Cryptocurrency Types: Core Assets and Potential Picks, How to Develop Your Personal Investment Plan?

In the current environment of intense fluctuations in the financial markets, an increasing number of investors are incorporating crypto assets as a key component of their asset allocation. Due to their unique liquidity and privacy features, cryptocurrencies are becoming a new option for asset hedging and appreciation. However, faced with thousands of different cryptocurrencies, how to select worthwhile investment targets becomes a critical issue. This article will provide an in-depth analysis of market cap ranking systems, the differences among various types of cryptocurrencies, and offer 8 highly regarded investment directions to help you build more rational investment decisions.

Core Logic of Crypto Investment

Anyone who has experienced a complete bull and bear cycle in the crypto space has heard a classic saying: “In a bull market, focus on altcoins; in a bear market, accumulate mainstream coins.” The market wisdom behind this is worth a deep understanding.

In a bull environment, capital is abundant, and investors chase high returns. Altcoins, due to their lower base, are more likely to see price surges. At this time, the gains of mainstream coins are limited, and marginal returns diminish. Conversely, when a bear market arrives, risk appetite declines, retail investors tend to cut losses and exit, and altcoins, with poor liquidity and high zeroing risks, are sold off sharply. Compared to them, mainstream coins with top market caps, supported by solid fundamentals and ecosystems, become safe havens for capital allocation.

Therefore, the first step in choosing crypto investments is not blindly following the trend, but accurately judging the current market cycle position. Next, consider multiple factors such as the target coin’s reputation, trading liquidity, ecosystem application depth, and volatility characteristics. This framework can help investors make correct decisions at the right time.

Market Cap Ranking Interpretation: The Current Crypto Ecosystem Map

Cryptocurrencies ranked at the top by market cap usually represent assets with the strongest market consensus. They are recognized not only for their excellent project quality but also often serve as leaders in their respective sectors, acting as a barometer for later entrants. The following is the status of the top ten cryptocurrencies by market cap as of the end of 2025:

Data updated as of December 2025; source: on-chain real-time market data

It’s important to note that rankings are not permanent but are adjusted in real-time according to market dynamics. Historically, altcoins like Filecoin, Luna, Polkadot, which once ranked in the top ten, have been pushed out due to narrative shifts or ecosystem difficulties. Many investors, chasing high returns, concentrated their holdings in these high-volatility assets, only to suffer huge losses during market reshuffles. This reminds us that rankings are only references; one should never adopt a “all eggs in one basket” gamble strategy.

In-Depth Analysis of 8 Potential Crypto Coins

1. Bitcoin (BTC): Digital Gold of Crypto Assets

As the pioneer of the crypto world, Bitcoin was born in 2008 and has long held the number one market cap position. Its market share remains stable above 50%, reflecting strong market recognition of its store-of-value function.

Bitcoin’s scarcity design is unparalleled: a fixed total supply of 21 million coins, never changed. The halving events every four years induce deflationary effects, further strengthening its scarcity value. The latest inflation rate is below 0.80%, far lower than any traditional asset. Since the approval of spot ETFs by the US SEC in 2024, institutional capital has surged in, and BTC’s price trend has entered a new phase.

Investment Highlights: Unmatched scarcity, clear anti-inflation properties, highest market recognition, strongest liquidity

2. Ethereum (ETH): Foundation of the Public Chain Ecosystem

Although Ethereum’s market cap is slightly below Bitcoin’s, its smart contract functionality has ushered in a new era of blockchain applications. Thanks to this innovation, developers worldwide flock to the Ethereum ecosystem to create applications, making ETH a necessity asset.

Data shows that Ethereum’s on-chain total value locked (TVL) has reached 93.1 billion USD, leading all public chains. ETH’s daily trading volume often reaches 60-70% of Bitcoin’s, reflecting high market activity. After the 2024 spot ETF launch, institutional interest is high, with many funds applying for ETF staking features, which, once approved, will greatly enhance product appeal.

Investment Highlights: Rich application scenarios, strongest ecosystem depth, strong institutional allocation, high growth potential

( 3. TAO Coin (TAO): A New Direction of AI×Blockchain

With the wave of artificial intelligence sweeping globally, integrating AI with blockchain has become a market focus. TAO Coin emerged from this trend, backed by the Bittensor network—a platform dedicated to building a decentralized machine learning service marketplace.

In this ecosystem, users can directly purchase AI model services on nodes using TAO coins. The design concept of TAO references Bitcoin’s scarcity model: a fixed 21 million coins, gradually deflationary, ensuring long-term value support.

Investment Highlights: Taps into AI trend, sound economic model, reasonable circulation rate, high growth potential

) 4. Ripple (XRP): Institutional-Grade Payment Layer

Ripple, backed by Ripple Labs, has established extensive cooperation with governments and financial institutions worldwide, providing strong endorsement for XRP. Compared to Bitcoin’s 7 transactions per second, XRP’s theoretical processing speed reaches 1500-3400 TPS, and in actual operation, remains stable at 500-700 TPS, making it an ideal choice for institutions and enterprises.

Recently, amid regulatory easing, XRP has gradually regained market confidence, and its strategic position is being re-evaluated.

Investment Highlights: Deep institutional cooperation, excellent transaction efficiency, practical payment applications, improving policy environment

5. Solana (SOL): Benchmark of High-Performance Public Chains

SOL is praised as the “Ethereum Killer” for its performance and cost efficiency. Through advanced technologies like parallel processing, SOL’s theoretical throughput reaches 65,000 transactions per second, with stable operation at 3,000-4,000 TPS, far exceeding Ethereum’s 15-30 TPS.

Transaction costs are also very low, averaging only $0.00025 per transaction, making it highly cost-effective. This performance advantage has attracted many developers and users to migrate, boosting ecosystem activity.

Investment Highlights: Industry-leading performance, low costs, rapid ecosystem growth, diverse applications

6-8. Other Mainstream Options

Chainlink ###LINK###: Unique bridging advantage Chainlink’s Oracle network connects on-chain data with real-world information, providing secure off-chain data access for smart contracts. This gives Chainlink an essential infrastructure role, distinct from “air coins,” with clear market demand.

Dogecoin (DOGE): Cultural asset victory DOGE’s value is supported by a strong community culture and ongoing attention from influential figures like Elon Musk. Its movements can trigger market volatility, indicating the market’s pricing of its cultural attributes.

TRON (TRX) and Bittensor: Ecosystem support TRX, as the core asset of the TRON ecosystem, has a stable application foundation. TAO’s positioning in the AI wave is increasingly prominent.

Classification of Crypto Types and Trading Insights

Based on different dimensions, cryptocurrencies can be divided into multiple categories:

By Market Cap: Mainstream coins (top ten) vs. Altcoins (below top ten) Mainstream coins, due to their large market caps, are difficult to manipulate, with ample liquidity and strong risk resistance. During bear markets, capital tends to concentrate in mainstream coins, which is a key reason they rarely go to zero. Therefore, long-term investments over 4 years should prioritize mainstream coins.

By Price Volatility: Stablecoins vs. Non-stablecoins Among the top ten by market cap, USDC and USDT are pegged 1:1 to USD, with volatility usually below 1% (except in extreme cases). Stablecoins are suitable as cash reserves but rarely generate significant returns through holding.

In contrast, non-stablecoins like BTC, ETH, XRP, DOGE, SOL show significant gains in each bull cycle. For example, in the last bull market, BTC surged 1800%, and XRP, affected by US regulatory crackdowns, performed relatively weaker but still rose from $0.2 to $1.8 (800% increase).

Short-term Trading Differences: In short-term trading, mainstream coins, due to their large market caps, are less susceptible to manipulation, effectively reducing liquidation risks. Conversely, small-cap altcoins, especially newly launched projects, are often manipulated by project teams or exchanges, making retail investors vulnerable to being caught at high prices or liquidated.

Practical Investment Pathways

( Buying Channels and Basic Operations

The most common method is to register on centralized exchanges. The standard process: register → verify identity → link payment methods → deposit funds and buy.

Typically, you first purchase stablecoins (USDT, USDC, etc.) via fiat-to-crypto (C2C) in the fiat trading section, then switch to crypto-to-crypto trading to buy target coins. BTC and ETH, due to their high reputation, can be directly bought via C2C.

Besides spot trading, exchanges also offer derivatives like crypto futures, leveraged tokens, staking, and mining, suitable for different risk preferences.

If platform operation seems complex, OTC trading is also an option—trading with reputable acquaintances, preferably face-to-face, to effectively avoid scams.

) Long-term Holding: Psychological Strategies

On the surface, long-term holding seems as simple as “hold and do nothing,” but in practice, it’s extremely challenging: the impulse to sell during price surges, fear of liquidation during dips, and daily monitoring causing psychological stress. Therefore, it’s recommended to clarify trading goals and adopt a combination of long-term and short-term strategies.

An advanced approach is to transfer long-term assets to cold wallets or hardware wallets for physical isolation. This not only secures assets but also psychologically detaches you from frequent trading.

Practical Tips from Investors

Why Beginners Should Prioritize Long-term Investment

Short-term trading, especially day trading, is very unfriendly to beginners. It requires systematic trading strategies, precise position management, strong psychological resilience, and other professional skills. In contrast, long-term investing has a much lower entry barrier—just understanding basic operations and judging market cap levels.

Does Long-term Investment Really Yield Lower Returns?

Theoretically, short-term trading through continuous buy low and sell high can achieve higher returns. However, reality is harsh: no investor can predict market movements with 100% accuracy. In actual operations, small mistakes often lead to missed gains or losses from overbuying or selling at the wrong time.

My personal experience: in 2018, I bought 3 BTC near the arc bottom at around $5,000, and impatiently sold at $7,000. BTC then continued rising to $12,000, which I regretted. Fortunately, the Black Swan event of 3/12 provided a second chance to re-enter. Compared to that, adopting a long-term holding strategy avoids timing difficulties and automatically captures the entire upside of the upward trend.

Asset Security Always Comes First

When you endure the bear market and finally reach the bull, discovering your assets have been stolen would be devastating. Therefore, security must be highly prioritized:

• Exchange accounts: keep passwords secure, enable two-factor authentication
• Wallet storage: back up private keys and seed phrases properly, avoid authorizing in insecure DApps

Beware of Self-Deception and Psychological Traps

The most common fatal mistake for beginners is being fooled by low-priced altcoins. Seeing a string of zeros after the decimal point, fantasizing that if it rises to one cent or one dollar, your hundreds of millions of coins will instantly make you rich.

The reality is: these altcoins either go to zero or are on the way there. Even worse, beginners often exchange high-market-cap quality coins for a bunch of junk coins, ending up empty-handed on both ends.

How to Formulate Your Own Investment Plan

Based on the above analysis, investors should choose according to their own characteristics:

Conservative Investors: Focus on BTC and ETH, as they are the most consensus-backed and safest options.

Growth-Oriented Investors: Besides BTC and ETH, consider allocating modest amounts to DOGE, ADA, SOL, and other mainstream coins to participate in more ecosystem opportunities.

High-Risk Tolerance: You can try small positions in innovative directions like TAO and LINK, but be sure to control the proportion.

Strictly Avoid: Small MEME coins and highly volatile tokens—they may achieve 100x gains in a short time but often collapse to zero just as quickly.

The core principle is: regardless of which crypto categories you choose to invest in, avoid common fatal mistakes—unclear goals leading to frequent stop-losses, not understanding stop-loss mechanisms causing losses to expand, or long-term holding altcoins leading to capital being trapped. Otherwise, even the best markets will be hard to turn losses around.

Crypto investment is not a shortcut to overnight riches but a long-term journey requiring rational judgment, patience, and continuous learning. Mastering the correct investment framework, choosing suitable crypto types and strategies, is the right path to financial freedom.